Yinson Annual Report 2021

17 ANNUAL REPORT 2021 MANAGEMENT DISCUSSION & ANALYSIS Yinson was not spared from the tremendous challenges that buffeted the world in FYE 2021, disrupting the global economy and individual lives. The theme for this Report, ‘Rising Beyond’, is a reflection of how we endeavour to overcome the challenges and continue to deliver on our commitments, including strong financial results, expanding our business into new territories and industries, and maintaining a solid project and operations performance. GLOBAL MARKET OVERVIEW 2020 was a year of surprises. No one could have predicted how quickly the Covid-19 pandemic escalated and the severity of respective lockdowns. The world also experienced extreme market volatility, unprecedented fiscal and monetary responses and tumultuous geo-political challenges. Towards the end of 2020, we saw the global economy starting to recover from the earlier collapse brought about by the pandemic. Although the output rate is anticipated to remain lower than pre-pandemic levels for some time, nevertheless we are hopeful that 2021 can bring stability and a reset for a number of disruptions, especially as vaccine prospects play out as expected. The pandemic, which increased macroeconomic uncertainties, also resulted in the price free fall of many key commodities, as accentuated by a sharp decline in crude oil prices in March 2020. Lower transportation activities from worldwide restrictions both internally and cross borders further lowered oil demand. As a result, an oil oversupply materialised. Production cuts were subsequently agreed amongst oil producing countries to curtail the oil stockpile and stabilise oil prices. With global commodities prices now recovering, economies turning around and positive vibes from vaccine rollout plans, we are cautiously optimistic that oil prices will either remain rangebound around current levels or rise further in 2021. LIM CHERN YUAN Group Chief Executive Officer